Jerry Brown explains California minimum wage deal
California lawmakers moved swiftly Thursday to ratify a deal boosting the state minimum wage to $15, sending legislation to Gov. Jerry Brown just days after the governor announced a deal with labor leaders.
With his planned signature in Los Angeles on Monday, Brown will avert a costly ballot fight, give California the nation’s highest wage and make it the first state to vindicate organized labor’s national “Fight for 15” rallying cry. Labor officials were triumphant.
“The credit for making history today belongs to the workers who spoke out and risked it all, the labor unions and community organizations who supported them, and elected leaders here in California who listened,” Service Employees International Union Local 2015 president Laphonza Butler, who had vowed to pull back an SEIU-backed minimum wage ballot initiative if the bill passes, said in a statement. “As a result, millions of Californians are on the path out of poverty.”
Wage hikes would occur annually, beginning with a boost to $10.50 in 2017 for businesses with 26 or more employees, $11 in 2018 and another dollar each year thereafter.
After the wage hits $15 it could continue to rise with inflation. Smaller businesses would have an additional year to implement each annual bump. The bill would also provide in-home health aides three annual sick days. According to the Department of Finance, a $15 wage would cost California about $4 billion a year.
Brown had warned a $15-an-hour wage must be done carefully, noting costs to employers and the state. But with a measure heading for the November ballot, he negotiated with unions and other advocates to include provisions that allow governors to postpone an increase if the economy falters.
Those provisions would allow governors to suspend annual wage increases short of $15 if officials project that the state’s budget reserves will be in the red, or if employment and sales tax revenue decline. Governors would need to decide each September whether to suspend increases coming the following January.
In the first significant test for new Assembly Speaker Anthony Rendon, D-Paramount, Senate Bill 3 passed the Assembly floor on a 48-26 mostly party-line vote Thursday. Two Democrats voted no – Assemblymen Adam Gray of Merced and Tom Daly of Anaheim – and Assemblyman Rudy Salas, D-Bakersfield, withheld his vote.
The Senate approved the measure 26-12, following a similar pattern: Not a single Republican supported the bill in either house. Onlookers in the gallery erupted in cheers and shouts of “Si Se Puede!” after both votes, highlighting the vote falling on Cesar Chavez Day.
Democratic backers called the bill a lifeline to workers struggling to survive on the current $10-an-hour minimum wage. It drew support in the Assembly from both liberals and business-friendly moderate Democrats.
“Stagnant wages have hindered economic growth and relegated too many Californians to a life of poverty, especially in the Inland Empire,” said Assemblywoman Cheryl Brown, D-San Bernardino, a moderate facing an election challenge from the left.
At times shaking their heads and scoffing at the comments in opposition, Senate Democrats repeated that an increase of the minimum wage will make life easier for the state’s lowest income families and lift them out of poverty.
“There are people out there working 40 hours a week, doing back-breaking work, and still not earning enough to support their families,” said Sen. Hannah-Beth Jackson, D-Santa Barbara.
Republicans argued the bill would backfire, hurting the people it is intended to help by leading employers to cut entry-level jobs and raise prices. They warned an inflated cost of living would impoverish senior citizens living on fixed incomes.
“Income inequality is the definitive challenge of our generation,” said Assemblyman Jay Obernolte, R-Big Bear Lake, but “low wages are a symptom of income inequality. They are not the root cause.” A $15 minimum wage, he said, would “unintentionally make the problem much, much worse.”
Those arguments amplified criticism from business groups who have assailed the $15 rate. They call it an untested overreach that will worsen a business climate already burdened by heavy regulation and a recently implemented $10 wage that is among the country’s highest. California Chamber of Commerce president Allan Zaremberg called it “too much, too fast” in a statement.
“Once taxpayers wake up and see newspaper headlines tomorrow morning, business owners are going to think it’s an April Fools joke,” said Sen. John Moorlach, R-Costa Mesa.
Assemblyman David Hadley, R-Manhattan Beach, said it would inflict pain on economically beleaguered areas of California, criticizing lawmakers “who live in high-wage, affluent parts of coastal California, who are prepared to throw an entire region of this state under the bus.” He accused supporters of rushing needlessly.
“We went from a backroom deal on Sunday to a vote on the floor of this chamber on Thursday,” Hadley said. “For those of us who do not get back to our districts during the week,” he added, “this bill will have gone from a news article, a backroom deal, to passed through the Legislature without my having spent face-to-face time with a single one of my constituents. And I wonder if perhaps that was not the point of this whole exercise.”
Countering that point, Democratic backers argued policymakers have had years to mull a higher wage amid a concerted campaign to raise it.
“If you haven’t been talking about the minimum wage in your district,” said Assemblywoman Lorena Gonzalez, D-San Diego, “then you probably haven’t been talking.”